Summary: Medicaid costs
are soaring. States are hurting. Strains from pain-related conditions
factor in heavily. Meantime, surging prescriptions of pain
medications create new sets of adverse consequences. Can an integrated
care program featuring licensed acupuncturists, massage therapists and
holistically-oriented nurse managers be part of the solution? Since
2002, via legislation and a Medicaid waiver, the state of Florida has
engaged an "Integrative Therapies Pilot Project" to answer these
questions. Chicago-based Alternative Medicine Integration Group (AMI)
won the contract. ThisIntegrator Special
Report looks at AMI's clinical integration and payment model, patient
and practitioner experience, and clinical and cost outcomes and controversies in
the analysis of costs and cost-savings. Is this a model which Medicaid
should widely promote? Part 1 of this 5-part exploration is an overview
of issues and findings.

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Introduction: Can Integrative Therapies Relieve Chronic Pain and Limit Costs in a Medicaid Population?
The belief that a population of low-income, high-utilizing patients can
be managed successfully and at cost savings through integrated care
approaches is strongly held by many integrated care practitioners.

Florida's Agency for Health Care Administration

Unfortunately, the assertion has remained largely untested. The NIH National Center for Complementary and Alternative Medicine has only recently announced aan exciting program which might fund explorations of the effectiveness and cost-effectiveness of integrative therapies in real-time settings. Foundation funders have not stepped up. Only the rare complementary healthcare management company collects and publishes clinical and cost outcomes as part of their business model.

A unique Medicaidpilot project in Florida is beginning to give us some answers. In 2002, the Florida
State legislature passed language in a budget bill to enable the creation of an integrative therapies pilot program. The program required a Medicaid waiver to cover services of licensed acupuncturists and licensed massage therapists. The program focus: "quality
of care and cost-effectiveness of (an integrated) disease management initiative."

Adrian Langford, a long-time managed care executive who presently serves as a regional vice president for the Chicago-based Alternative Medicine Integration Group(AMI), pitched
the idea of potential benefits from such a project to legislators. AMI
eventually won the contract to develop and manage the pilot in a
3-county area in the Tampa Bay area.

Vendor to AHCA on the pilot project

Since early 2004, AMI, an Integrator sponsor, has managed up to 500 patients per month out of a rotating pool of approximately 2500 eligible patients through an integrated program managed by a holistically-oriented
nurse-manager. Tools include self-help CDs and some group education.
But what required a waiver are the services of licensed massage therapists and acupuncturists. The
program's target population is a set of high-cost patients with back pain, neck
pain, fibromyalgia and chronic fatigue who receive care under Florida'sMediPass program, managed by Florida's Agency for Healthcare Administration. AMI was charged to gather and
report data on clinical experience and costs.

The pilot program has generated strongly positive reviews from its
target population as well as controversy among regulators. Ultimately,
the program was renewed in 2007, with some changes in the management
plan. This 5-part IntegratorSpecial
Report examines AMI's clinical and outcomes strategy, experiences of patients and
clinicians, cost controversies, and the potential value
of the pilot in other regions and states.

Part 1: An overview

Part 2: Clinical management model.

Part 3: Experience and outcomes for patients and clinicians.

Part 4: Strategies and disputes in understanding cost outcomes.

Part 5: Perspectives from national leaders in integrative community medicine.

" ... the best practices of conventional
and complementary alternative medicine"

Key CAM services
and practitioners

Holistic nurse manager

Licensed massage therapists

Licensed acupuncturists

Self-help brochures and CDs

Nutritional counseling

Pharmacy consulting

Integrated context

Coordination with conventional

primary care practitioners

Coordinated referral to a select

chiropractic network

Original pilot years

2004-2007

Reporting
requirements

Annually to Florida State Senate
Appropriations Committee

Current status

Extended for 3 additional years,
with some changes

_______________________________________

1. Adrian Langford, AMI and the Project's Origins

Adrian Langford, VP, AMI Florida, is blunt in his assessment of conventional
management of chronic pain. The 20-year veteran of the managed care
industry states: "Conventional primary care doctors don't know how to
manage pain. They just throw drugs at them. Chronic pain is best
managed through teaching people how to help manage their own pain." He
adds: "Heck, in many instances, an $8 CD can be a lot better than
sending someone to a pharmacist."

"Conventional primary care
doctors don't know how
to
manage pain. They just
throw drugs at them.

"Chronic pain is best
managed
through teaching people how
to help manage their own pain."

- Adrian Langford, VP,
AMI Florida

Ten years ago, when complementary and alternative medicine began to
gain some interest among managed care firms, Langford developed a
network of complementary and alternative healthcare practitioners in
Florida. He began promoting a project with employers which focused on
potential cost reductions. But it wasn't until linking up with
Chicago-based AMI that Langford had a chance to test his beliefs and
passions.

AMI was a good fit for him, according to Langford. "AMI's strategy has
typically been to go straight to employers and other payers. Targeting
the Florida MediPass population - our Medicaid program here - followed that model."

AMI is known nationally for a managed care program withHMO Illinois, a
Blue Cross Blue Shield company. AMI found significantly less use of
conventional pharmacy, procedures, and hospital days in a population
for which care is managed care through a network of
non-pharmacologically-oriented primary care practitioners. (See related Integrator story here.) That AMI
network includes broad scope chiropractors and integrative
medicine-oriented medical doctors and osteopaths.

States Langford: "After what (AMI was) already doing, developing a
program for managing and measuring the outcomes of a high-cost Medicaid
population with integrative therapies was right up their alley."
Langford had a vision, and now he had a partner. What was needed was a
client.
2. Florida Legislature Enables Medicaid Waiver to Cover Unique Services

Florida prorgam from which pilot participants were drawn

An article last year on the pilot in the St. Petersberg Times ("Yes, Medicaid Pays for This,"
October 2, 2006) captured the context of the Florida legislature's
decision to go outside the box of conventional treatment succinctly:
"With Medicaid gobbling ever-larger chunks of state revenue, the
Legislature is experimenting."

AMI's integrative therapies demonstration project was enabled by
the Florida State legislature in 2002 through a clause in the state's
Fiscal Year 2002-03 General Appropriations Act, Chapter 2002-225 of the
Laws of Florida. The target of the appropriation was the improvement of
the "quality of care and cost-effectiveness of a disease management
initiative" in a localized area. The state was authorized to seek
"federal Medicaid waivers or state plan amendments" if the disease
management initiative would offer services not typically covered by
Medicaid. The initial plan was for a 3-year pilot.

The initiative was engaged at a time that Florida's Agency for
Health Care Administration identified chronic pain as the leading
cost driver of any chronic disease. According to Langford, these costs
outpaced those related to HIV/AIDS, asthma, hypertension and diabetes.

After approval by the legislature, management of the program was
eventually granted on May 6, 2003, to Chicago-based Alternative
Medicine Integration of Florida, LLC (AMI). The AMI proposal was for a
AMI set about building its care model and networks of practitioners.

3. Covered Servicesand Management Model

In the first phase of the program, patients were recruited through
communication with conventional primary care providers (PCPs). Once the
physicians agreed to have their patients participate, AMI had the
opportunity to directly solicit participation of patients via mail and phone through lists
provided regularly by MediPass.

Holistically-trained nurse case managers took the lead in the
recruitment and communication effort and then with patient management.Langford underscores the importance of these nurses in the AMI model:
"The key to the program is the nurse case manager. These nurses have
become trusted guides to most of the patient population."

The lead
nurse case-manager for the AMI program is Tracy Woolrich, RN, HHP (Holistic
Health Practitioner). Woolrich, who has extensive experience in
conventional case management, describes her job as a dream come true: "What is so wonderful is that I am finally doing what I wanted to do.
AMI is giving me the opportunity to do healing. It's not like anything
I've been able to do before, not like traditional nursing, that's for
sure."
AMI's two nurses help triage patients among
a variety of information
options and therapeutic services. These include conventional disease
management strategies such as dispensing informational fliers, support
in accessing community services, offering nutritional
counseling and managing communication with PCPs. Patients can also be
guided, under a separately-covered benefit, to area chiropractors.

But what most distinguishes the the pilot program is that participating
MediPass beneficiaries have access to a controlled number of massage
treatments or acupuncture treatments each month. Participant Richard Adams, a disabled medical assistant, recalls receiving the solicitation: "I
said, what have I got to lose. I had nothing but time on my hands."
Adams chose acupuncture rather than massage and began a series of
treatments.

Part 2 of this Special Report will explore AMI's individualized care management process.

All data from reports provided to the Florida legislature
by Alternative Medicine Integration Group of Florida.

_______________________________________

4. Patient and Clinician Experience

Adams provided the Integrator with a personal window on his
experience with acupuncture: "I never had acupuncture before. I never
believed in it. I was totally skeptical."

Adams has now had what he estimates as 12-15 visits. How has it gone?
He references the perspectives of his conventional doctors: "My
GI doc, my podiatrist, my endocrinologist [Adams is a diabetic] - they all think it's a step
in the right direction. They've seen the change in me. My
endocrinologist said, 'whatever you are doing, keep with it.'"

Rick Adams, program beneficiary

As part of the
contract, AMI is required
to gather outcomes on patient perceptions of their experience. These
must be reported annually to the legislature. To date, AMI's reports
suggest that
Adams' experience is the norm. For instance, in a 2006 patient survey,
AMI found that 94% of respondents (30% response rate) agreed that
"program treatment providers help (me) to reduce (my)
levels of pain." This is up from 86% in a prior reporting period. An
AMI-conducted analysis, based on functional outcomes gathered with each
visit, found that on the Physical Component Summary of the SF-12, participants showed a 24% improvement over baseline.

Langford points to the mental health portion of the SF-12 as further compelling evidence of the value of the model. He
states: "Our first year measure on the SF-12 saw 16% increase on the
mental health portion and 20% in the second year." He reflects: "I
really find the mental health
improvements very interesting. They speak to the value of
patient-centered, relationship-oriented care systems. These
improvements are very
significant especially when you weigh in on the fact that we don't use
any
shrinks."

Part 3 of this Special Report will include methods, data and comments from AMI's patient surveys together with details from Integrator interviews with Medipass participants and with their massage and acupuncturist clinicians. 5. AMI's Analysis: Nearly 25% Lower Costs in Their Managed Population

Pleased patients alone will not float and extend the pilot program. The
Florida's legislature's primary concern, which led to granting the
waiver, was the crushing cost of chronic pain. The legislators wanted to
know if integrative therapies might make a difference on their bottom
line. The potential for expanding services throughout the state, and
gathering interest in other jurisdictions throughout the country, also
rests on the business model.

AMI's analysis of the cost of treatment of the participants, relative
to the MediPass norms, suggests that significant savings are flowing
from this program. States Langford: "Our managed group
realized a reduction of (per member per month) costs of over 9 percent while a comparable
non-managed population realized an increase of PMPM costs of 15.1 percent." Extrapolated for larger
populations, this nearly 25% cost differential amounts to potentially
tens of millions of potential Medicaid savings.

Langford provides some breakdown of the savings: "Pharmaceutical
savings during the early months of the program indicate a 20% reduction
in prescription drug
expenditures. Cohort populations not
managed by AMI experienced a 23% increase in pharmaceutical usage over
the same
time frame."
In a series of interviews for this feature, Langford noted that
the analysis of cost outcomes has been a highly politicized process. Yet
analysts for the state have chosen different markers and have reached
different conclusions. Clarity on cost outcomes has been obscured by
dueling methodologies for analysis and will be examined in Part 4 of the Special Report. We will walk through the analysis and back-and-forth over measurement of the
program's impact on the costs which the Florida legislature is seeking
to control.

6. Going Forward, in Florida and Beyond ...

Whatever the debate over outcomes, the Florida legislature has chosen
to amend and extend the AMI pilot program. In Part 5 of the Special
Report, the Integrator
will first examine features of the new model. Then leaders in community
medicine and integrated public health delivery will be interviewed on
their perspectives on this pilot. Is it worth emulating? What can be learned from the model?

Along the way, the Integrator will be interested in any
perspectives you might have on the Florida Medicaid pilot and other
strategies for integration of non-pharmacological approaches into care
of the underserved.

Disclosure: AMI is an Integrator sponsor.

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